In their continued efforts to actively reduce or eliminate their financial obligations to school districts related to mandate reimbursement claims, the Commission on State Mandates (COSM) has re-evaluated their nearly eight-year-old decision on SARC reimbursement. Axiom anticipates on January 26, 2006, the COSM will eliminate SARC as a mandate-reimbursable program. Therefore, school districts will no longer be able to recoup their costs related to the preparation and distribution of their SARCs. In addition, this will eliminate Axiom’s ability to offer a reimbursable product.
The argument that COSM has used to arrive at their decision goes back to the origination of the SARC from Proposition 98. The COSM now believes that when California’s voters passed Proposition 98 in 1988, they required a simple, “but not limited to” 13-component SARC. The state’s new argument is the voter’s intention was never to limit the SARC to just the original 13 components.
This rationale leads to the overturning of their original 1998 ruling that the SARC is a mandate reimbursable program. In 1998, the COSM accepted a test claim that sought reimbursement for the legislature’s additions to the SARC since Prop 98 (1993-1997). The COSM declared the additional portion of the SARC a mandate-reimbursable program.
Not only has the state now eliminated the SARC as a mandate, the decision was made to go retroactive back to January 1, 2005, ending the reimbursement opportunity from this date forward. For SARC costs incurred on or before January 1, 2005, claims will be honored as submitted. As always, the State Controller reserves the right to audit all claims for thoroughness and accuracy.
The SARC has grown tremendously over the last few years with the addition of the NCLB, Williams, and the latest SB 687 requirements. Even though the number of required components has increased significantly over the years, Axiom’s prices have actually been reduced. It is through the constant refining of our processes and our reliance on the newest technology that we have been able to stay ahead of the SARC game. Unfortunately, this may not remain the case for long if the SARC requirements continue to grow at the rate they have previously.
Just because the COSM has concluded that SARC is no longer reimbursable doesn’t make it right. Axiom is seeking feedback from our clients regarding the state’s decision to make SARC non-reimbursable. As it stands now, the state can freely impose endless new SARC requirements on districts without bearing any financial burden. Are you willing to accept the state’s decision? Would you like CSBA to consider fighting the state on this decision?
To send us your feedback, please email sales@axiomadvisors.net